Thermal runaway is a ductile localization mechanism that has been linked to deep‐focus earthquakes and pseudotachylyte formation. In this study, we investigate the dynamics of this process using one‐dimensional, numerical models of simple shear deformation. The models employ a visco‐elastic rheology where viscous creep is accommodated with a composite rheology encompassing diffusion and dislocation creep as well as low‐temperature plasticity. To solve the nonlinear system of differential equations governing this rheology, we utilize the pseudo‐transient iterative method in combination with a viscosity regularization to avoid resolution dependencies. To determine the impact of different model parameters on the occurrence of thermal runaway, we perform a parameter sensitivity study consisting of 6,000 numerical experiments. We observe two distinct behaviors, namely a stable regime, characterized by transient shear zone formation accompanied by a moderate (100–300 K) temperature increase, and a thermal runaway regime, characterized by strong localization, rapid slip and a temperature surge of thousands of Kelvin. Nondimensional scaling analysis allows us to determine two dimensionless groups that predict the model behavior. The ratio represents the competition between heat generation from stress relaxation and heat loss due to thermal diffusion while the ratio compares the stored elastic energy to thermal energy in the system. Thermal runaway occurs if is small and is large. Our results demonstrate that thermal runaway is a viable mechanism driving fast slip events that are in line with deep‐focus earthquakes and pseudotachylyte formation at conditions resembling cores of subducting slabs.